Income taxes will always be too high; the question is, If you're going to make cuts, how?

There can be philosophical
problems with any tax cutting plan, chief among them the fact that taxes
are high enough to absorb cuts to begin with. That being the case, and
with there existing a certain mindset suggesting any income tax is too
much income tax, debate shifts to matters more practical: Who should get
tax cuts and why? What are the political implications of any tax cuts?
How will the federal government ever pay for those tax cuts? Should taxes
be cut outright, gradually, or should one-time rebate checks be issued?
So on and so forth. Worse yet, there exist souls so poor they are opinion
columnists, and they are commanded by ideological forces beyond normal
understanding to explain why their party’s plan is better than the
other party’s plan, even if it’s not any better.

It just
so happens President Bush’s tax cutting plan is better than the alternative
offered by Democrats, if for no other reason because it temporarily takes
more money out of the federal government’s hands (whatever growth
is spurred by the plan should more than replace it). To get deeply into
the particulars of the president’s plan would require more space than
is commonly allowed this column, so the temptation to carry on enthusiastically
about taxation’s lacking moral value isn’t an option. Instead,
the original questions will be answered, so at least a certain ideological
groundwork can be laid.

One: Who should get tax cuts and why? There is no greater
irony in modern American politics than a dais full of millionaire liberal
Democrats speaking at length about the inequities between the rich and
the poor. At least Republicans (those of clear conscience, anyway) will
tell you the truth: Of course this plan benefits the rich more than it
benefits the poor, because the rich pay much more into the system than
the poor, and therefore stand to gain more from even a one percentage
point cut than the poor who, as the lowest 1/3 of all income earners in
America, end up not paying any taxes at all.

President Bush’s mistake in this plan was in not
coming out and asking for a (let’s use an arbitrary number) three
percent rate cut in every income tax bracket, spread out over the next
three years. But it’s not so grand a mistake that it cannot be overcome
with what he prescribed for lower income people and working families,
in the form of larger child credits, to make all sides content with their
own priorities. (The great disaster of the plan was the $3,000 the president
would like to give unemployed people to help them … do whatever,
but that’s a column for another time.)

Two: What are the political implications of any tax cuts?
If the plan as a whole in implemented, and things are going well in the
fall of 2004, there are no political implications, other than those Democrats
who went along with the winning idea can campaign on the success (as they
should). If things don’t go well – an absurdity, given that
the economy is expected to expand at three percent this year, and will
go along naturally at a fine clip from there – the president will
get a few knocks, but unless Jack Kennedy shows up tanned and well rested,
or unless Iraq and / or North Korea goes very badly, Bush will win.

Three: How will the federal government ever pay for those
tax cuts? It doesn’t. Governments don’t pay for tax cuts.
They either absorb the temporary shortfalls, knowing that any ensuing
stimulus will turn those deficits into surpluses, or they cut spending.
“Paying for tax cuts” is a fancy way for politicians to say,
“This thing about lowering people’s income tax is nice and
all, but it takes money away from the federal government, giving it less
to spend on pivotal programs.”

Exactly. Except that the money, by and large, won’t
be spent on anything that matters, instead it will go into any one of
the (numerically impossible to calculate) ridiculous studies, hog waste
disposal farms, or whatever the hell else it gets spent on. And if you
think the federal government isn’t still paying $500 for a plunger,
you’re mistaken. A government with less money is inclined, one hopes
against hope, to do less damage; the less money available to the feds
the better. For that reason only, it’s almost a shame there will
be any resulting stimulus at all.

Four: Should taxes be cut outright, gradually, or should
one-time rebate checks be issued? One-time rebate checks are pleasant
things to think about, but they fool way too many people into thinking
they’re getting enough of their own money back, and that deception
is the point behind any and all tax rebate checks. What’s more,
the checks aren’t enough of a rebate, and they’re too short
term. Rates of taxation should always be cut dramatically. Absent that,
gradual cuts are fine, so long as they’re spread out over a few
years and not a decade or more.